S. 4218 — VA Appraisal Modernization Act

This section establishes appraisal fees for Department of Veterans Affairs (VA) home loan guarantees by adding new section 3731A to chapter 37 of title 38, United States Code (with a conforming amendment to the table of sections). It requires the VA Secretary to (1) set baseline fees within 180 days of enactment; (2) adjust those fees annually starting January 1, 2027, to reflect increases in the Federal Housing Finance Agency's quarterly purchase-only House Price Index, rounded to the nearest $25; and (3) publish the fees online and notify VA-listed appraisers. It further directs the Secretary to quarterly designate and list high-demand counties—where average appraisal completion exceeds the timeliness standard by more than three business days, more than 15% of assignments remain unassigned for five or more business days, or demand exceeds appraiser capacity—and remote counties, defined by fewer than five appraisers within 30 miles of the county center, average one-way appraiser travel exceeding 40 miles, or low appraiser density relative to loan volume. In high-demand counties, appraisal fees must increase to at least 125% of the baseline fee (up to 150% if designated for four or more quarters); additionally, for appraisals in high-demand or remote counties, the Secretary must reimburse appraisers for mileage at the General Services Administration rate under 5 U.S.C. §5707(b).

This section directs the Secretary of Veterans Affairs, not later than 180 days after the date of enactment, to submit to the Senate Committee on Finance and the House Committee on Ways and Means a report estimating the effects of new VA appraisal requirements (added by section 2) on (1) government expenditures over time, (2) the number of appraisers joining the VA appraisal network, (3) appraisal completion times in high-demand counties, and (4) the use of VA-guaranteed housing loans under 38 U.S.C. chapter 37, along with recommendations to prevent fraud, waste, and abuse in implementing those requirements. The section further directs the Secretary, within the same timeframe, to conduct and report to Congress on a study of the feasibility and advisability of (1) procuring contracts for home appraisers in areas where supply cannot meet demand and (2) restructuring the VA appraisal process to mirror that of Federal Housing Administration-insured loans, with the report also made publicly available.